Two Major Workplace Lawsuits in News

Costco employees have filed a unpaid wages lawsuit in California stating the company had repeatedly violated the state’s wage and labor law. Costco faces allegations similar to those Tennessee Law Blog reported last year in the nationwide unpaid overtime lawsuits against Wal-Mart stores. Specifically, Costco has allegedly required employees to work off the clock by locking employees in the store after their shifts and not paying them for this time or overtime as required under state employment laws.

Unlike earlier Wal-Mart lawsuits, Costco has apparently claimed that keeping employees after they clocked out was for security reasons. Apparently managers forced employees to remain after their shifts while they performed closing tasks, such as removing valuables from display cases and emptying cash registers. Costco employees were unpaid for this time off-the-clock during which they were not permitted to leave.

Tennessee labor law requires employees be paid for their time, including required training and, in some cases, travel time. If something similar to what California Costco employees faced is happening at your Tennessee place of employment, you may have the opportunity to recover unpaid wages under Tennessee’s wage and hour law.

In other employment law news, drugmaker Wyeth faces False Claims Act penalties for overcharging Medicaid for Protonix, a popular stomach acid drug. Two whistleblower lawsuits have been joined by the U.S. Justice Department for recoveries and penalties in the millions of dollars.

From 2000 and 2006, according to court papers, Wyeth offered dramatic discounts (up to a 94% discount) to thousands of hospitals nationwide for its stomach acid drug that weren’t offered to state Medicaid programs. By doing so, the whistleblower lawsuits and federal government claim, Wyeth avoided hundreds of millions of dollars of rebates that would have cut costs to the program for the poor–prescription costs that state and federal taxes had to pay. Simply put, Medicaid programs in Tennessee and throughout the U.S. were forced to pay significantly more for their Wyeth drugs than they should have. These overcharges violate Medicaid programs’ “best price reporting requirements” and can be recovered under False Claims law.

In addition to Tennessee, the other states joining the lawsuit are (alphabetically) California, Delaware, Florida, Illinois, Indiana, Louisiana, Massachusetts, New York, Michigan, Nevada, New Hampshire, Texas, Virginia, and Wisconsin.